HMH buys out Surgical Center of Elizabethtown

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$6.8 million purchase could be final next week

By Marty Finley

Less than a month after welcoming Elizabethtown Orthopedics into the fold, Hardin Memorial Health intends to close next week on one of its largest practice acquisitions to date.

HMH is finalizing the purchase of Surgical Center of Elizabethtown, which the Board of Trustees approved last month at a cost of $6.8 million.

Through the acquisition, the health system assumes the real estate and all tangible and intangible assets of the practice, said Dennis Johnson, president and CEO of HMH. The health system, in addition, will employ the 34 staff members at the center and maintain relationships with the physicians and anesthesiologists who practice there, said Greg Rovinski, assistant vice president. Rovinski said some of the physicians at the center already have employment agreements with HMH.

Located at 108 Financial Drive, Surgical Center of Elizabethtown performed its first procedure in November 1983 and has since treated more than 60,000 patients and completed around 100,000 surgeries, according to its official website. The facility relocated in December 2004 from its original location on Westport Road.

With more than 50 practicing physicians, the center’s range of surgical services encompasses dental, endoscopic, general surgery, gastroenterology , gynecology, otolaryngology, ophthalmology, orthopedic, plastic and reconstructive, pain management, podiatry, and urology, according to its website.

Johnson said the center approached HMH 18 months to two years ago, promoting options for a merger or buyout of the practice. Since then, talks have continued “in earnest” to reach an agreement, said Hardin County Judge-Executive Harry Berry, who serves as chairman of the HMH board.

Berrysaid discussions date back even farther, when the two entities started negotiating measures in which they could work together under a partnership.

Johnson said HMH has long admired the work done at Surgical Center of Elizabethtown. He said the purchase was mutually beneficial because the health system has identified an “urgent” need for assistance inside its OR. Berry said the hospital can utilize the rooms at the center, which will relieve stress off beds at the hospital’s main campus on Dixie Avenue.

Rovinski said the hospital reviewed the purchase in detail through real estate appraisals and property valuations, convincing administrators a purchase of assets was a wise maneuver.

Berrysaid the purchase affirms the health system’s mission to grow its business and widen its footprint in expectation of rising healthcare costs.

“It’s to get a synergistic effect of having a one-stop shop at HMH and protecting our market share,” Berry said.

When asked if this rated as one of the largest acquisitions HMH has made since rolling out an aggressive approach of purchasing practices, Johnson said “no question.”

In fact, the purchase is only rivaled by the procurement of Elizabethtown Diagnostic Imaging last fall, which was obtained for $6.9 million. HMH also purchased Surgical Specialists PSC in 2010 for $3.5 million. Both practices are located on Ring Road.

The most recent purchase, Elizabethtown Orthopedics, concluded earlier this month. HMH retained more than 20 employees on staff at the facility, located at 1113 Woodland Drive.

Marty Finley can be reached at (270) 505-1762, or at mfinley@thenewsenterprise.com